Borders to close 30 percent of stores, including 7 in Valley, 1 in TucsonPosted: Updated:
PHOENIX -- Bookseller Borders, which helped pioneer superstores that put countless small local bookshops out of business, filed for bankruptcy protection Tuesday, sunk by crushing debt and sluggishness in adapting to a rapidly changing industry.
The 40-year-old company plans to close about 200 of its 642 stores over the next few weeks. All of the stores closed will be superstores, Borders spokeswoman Mary Davis said. The company also operates smaller Waldenbooks and Borders Express stores.
Borders plans to operate normally and honor all gift cards and its loyalty program as it reorganizes.
The company will receive $505 million in debtor-in-possession financing from GE Capital and others to help it reorganize.
According to the filing, Borders had $1.28 billion in assets and $1.29 billion in debts when it filed for bankruptcy protection.
Borders also suffered from a series of errors: failing to catch onto the growing importance of the Web and electronic books, not reacting quickly enough to declining music and DVD sales, and hiring a series of CEOs without book-selling experience.
At its peak in 2003, Borders operated 1,249 stores under the Borders and Waldenbooks names, but now it operates barely half that. Its annual revenue has fallen by about $1 billion since 2006, the last year it reported a profit.
There are 11 Borders stores in the Valley, including a Waldenbooks, and two locations in Tucson.
Borders Groups said seven of the Valley stores and one Tucson store will close. The locations currently slated for closure are at Gateway Pavilions in Avondale, Chandler Pavilions in Chandler, Mesa Fiesta Shopping Center in Mesa, Biltmore Fashion Park in Phoenix, Paradise Village Shopping Center in Phoenix, Scottsdale/101 in Scottsdale, Scottsdale Waterfront in Scottsdale and Tucson Fiesta in Tucson.
The stores are expected to close by the end of April.
To find out more about the reorganization and Borders Group's plans, visit BordersReorganization.com.